Exit planning for your financial future

For many business owners, a fruitful exit is a marker of success. Therefore, it’s not surprising that exit planning has come up in recent conversations with some of my contacts. A sale, and possible subsequent retirement, may be far away, but financial planning must begin early with a clear, actionable strategy.

Moving on: why choose to exit?

There are many reasons why a business exit might be right for you. Retirement may be on the horizon, and you’ll need to ensure that you have funds available to live comfortably without the security of a monthly wage. Perhaps the time is right to sell up and move on, and you need maximum profit from the company sale to finance your next project. Or you may be looking at a merger, acquisition, or even liquidation. Whatever your reason, an exit must be approached with a detailed understanding of your business’ financial forecast.

Preparing for retirement: securing your future

When you’ve worked for more years than you’d care to count, retirement can be an exciting prospect. However, a slower pace of life comes at a price. Now’s the time to plan ahead for living without a regular wage.

For a comfortable retirement, you need to find the magic number. Ask yourself how much money you’d like to have available to you. Answer that question, and you’ll have your financial target. From there, scenarios can be put in place for growing your business so you can achieve the amount you need when it comes to sale. Retirement may seem a few years away yet, but exit planning now secures your financial future.

Confidential planning: a private matter

Exit planning needs to be handled discreetly. Most company owners – my clients included – want reassurance that an exit strategy will be discussed in confidence. This is particularly true when an owner is unsure whether to sell the business at all. Perhaps they need to simply start by crunching the numbers to see if a sale is a viable option.

I’ve recently worked with a client to plan for exiting their business in two years’ time. In privacy, we discussed their ideal income from the business sale. With that figure in mind, we could plan to make the business worth this target price by the time the sale came around. We created a forecast for the business continuing as usual, with very little change up to the date of sale. Then, to compare, we developed varying scenarios to detail how many new clients would be required, and at what monthly income level, to create the desired outcome. This included careful consideration of cost increases as a result of additional sales.

The initial target was a successful exit. However, our planning may have concluded with the client deciding to continue trading without selling up, knowing that the business can make decent profits. A sale is now only a consideration, so it is imperative that exit planning is handled in the strictest confidence.

The magic number: selling for the right price

Your reasons for exit may be positive. However, selling the business you have worked tirelessly to build can be an emotional process. As an independent financial director, I’m able to give my clients an objective, unbiased and honest assessment of their finances. Taking into account their business in its entirety, I can see where changes need to be made in order to make exit a success. We create a detailed plan, and outline what needs to be done in order to sell the business for the desired price.

Find your magic number, and you’ll have a financial target. Whether you’re heading towards retirement or moving on to a new venture, strategic exit planning ensures you meet your goal.


Send us a message.

Not Just an FD
Not Just an FD
Our details
0113 385 4656
5 Carrwood Park
Selby Road
LS15 4LG